Up-to-the-minute advice, information, resources, and, on occasion, commentary on federal and New Jersey state income taxes, and the various New Jersey property tax rebate programs, and insights and observations on tax policy and professional tax practice, by 40-year veteran tax professional Robert D Flach.

Wednesday, April 17, 2013

WHAT’S THE BUZZ? TELL ME WHAT’S A HAPPENNIN’ – WEDNESDAY EDITION

The BUZZ has
returned!

* During my bloging
hiatus I hope you were following my filing season Tax Tips at Mainstreet.com.

“ . . . a Currency Transaction Report isn’t
anything to worry about it. The IRS gets so many of them that as long as you’re
paying your taxes they’re not a big deal. Just smile as the bank teller fills
out the extra paperwork.”

It is the final
entry in a series of 10 Bozo Tax Tips.

* For those of you
who are interested here are the Obama’s and the Biden’s 2012 tax returns (click
on the names).

“In the 25 years since then {the Tax
Reform Act of 1986 – rdf}, the percentage
of nonpayers has doubled thanks to the expansion of the Earned Income Tax
Credit and the enactment of a plethora of new credits, such as the child credit
and the more recent Making Work Pay Credit.In 2010, tax credits had a combined budgetary cost of $224 billion.Half of these costs were refundable cash
payments to nonpayers.”

Refundable credits
are bad tax and fiscal policy, and are magnets for tax fraud.

“The House on Monday unanimously backed
legislation to bar federal funding for contractors that fall behind on taxes
but rejected a proposal to prohibit tax-delinquent individuals from working for
the federal government.”

* FYI –

“The IRS will provide penalty relief to
anyone unable to file on time due to severe storms in parts of the South and
Midwest just prior to the filing deadline. In some cases, power outages and
transportation problems have made it very difficult or impossible for some
taxpayers and tax professionals to meet the regular April 15 deadline.
Taxpayers will qualify for penalty relief if, as a result of being directly
impacted by these storms, they are unable to file their returns or pay tax due
until after April 15.

This relief, which applies to both the late-filing
penalty and the late-payment penalty, is available provided that taxpayers file
the return or pay the tax within a reasonable time after the power outages and
transportation problems have been resolved. Affected taxpayers may receive
penalty notices from the IRS. The IRS will abate these penalties if they
request reasonable cause relief based on the April storms. However, the IRS is
not authorized to abate interest.”

This relief applies to all individual taxpayers who
live in Suffolk County, Mass., including the city of Boston. It also includes
victims, their families, first responders, others impacted by this tragedy who
live outside Suffolk County and taxpayers whose tax preparers were adversely
affected.

Under the relief announced today, the IRS will issue a
notice giving eligible taxpayers until July 15, 2013, to file their 2012
returns and pay any taxes normally due April 15. No filing and payment
penalties will be due as long as returns are filed and payments are made by
July 15, 2013. By law, interest, currently at the annual rate of 3 percent
compounded daily, will still apply to any payments made after the April
deadline.

The IRS will automatically provide this extension to
anyone living in Suffolk County. If you live in Suffolk County, no further action
is necessary by taxpayers to obtain this relief. However, eligible taxpayers
living outside Suffolk County can claim this relief by calling 1-866-562-5227
starting Tuesday, April 23, and identifying themselves to the IRS before filing
a return or making a payment. Eligible taxpayers who receive penalty notices
from the IRS can also call this number to have these penalties abated.”

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(1) Before contacting me with questions about how a blog post relates to your specific situation, please be aware that I do not give free tax advice to non-clients by e-mail, comment response, or phone. So don't waste your time and mine.

(2) I am winding down my tax practice, and I will not, under any circumstances, accept any new clients. Period. I am actually trying to "thin the herd".